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U.S. Video Games Drop 28% to $516.5 Million in May

June 14 (Bloomberg) -- U.S. sales of video-game hardware, software and accessories tumbled 28 percent in May to $516.5 million from a year earlier, amid a shift by consumers to Internet-based games.

Retail sales totaled $718.9 million a year ago, when the industry benefited from a Nintendo Co. price cut on its 3DS handheld console, researcher NPD Group Inc. said today in an e-mailed statement. Nintendo’s 3DS handheld was the only game console to see a sales increase from year-ago results, according to Port Washington, New York-based NPD.

Annual sales of packaged video games have fallen for three years as consumers move their purchasing to digital downloads and games played on Facebook Inc. and other social sites. About 36 percent of the total $1.17 billion in games sold last month were probably on a digital format, NPD said.

Nintendo’s sales of its 3DS handheld rose 17 percent over a year earlier, NPD said, without citing figures. Sales of older Nintendo handheld models rose 35 percent from a month earlier after the company discounted the product price on May 20, NPD reported.

Microsoft Corp., with 160,000 Xbox 360 consoles sold, led the industry for the 15th consecutive month as it continues to deliver features that expand beyond gaming into movies, music and other forms of entertainment, the Redmond, Washington-based company said in a separate statement.

Video-game makers voluntarily report their sales tallies. Nintendo and Sony Corp. often don’t report monthly figures, and they didn’t for May.

To contact the reporter on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net

To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net

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